O 

o 

rf 
O 


I  2-3S 
M 


^flUjLA 


aj/9  v 


MEXICO 

TODAY 


As  Seen  By  Our  Representative 

On  A  Hurried  Trip  Completed 

October  30,  1920 


H. 


THE  AMERICAN  EXCHANGE 

NATIONAL  BANK 
128  Broadway  New  York  City 


Bancroft  Library 


REPORT  OF  TRIP  THROUGH  MEXICO 

WITH    MEMBERS    OF    CHAMBER 

OF  COMMERCE  OF  HOUSTON, 

TEXAS—  OCTOBER  7-30,  1920. 

By  W.  H.  MOSELEY,  JR. 

The  American  Exchange  National  Bank, 

New  York  City. 
GENTLEMEN  : 

Under  the  supervision  of  Mr.  D.  D. 
Peden,  President,  The  Houston  Chamber 
of  Commerce,  and  Mr.  T.  L.  Evans,  Mana- 
ger of  its  Foreign  Trade  Department,  an 
organized  Trade  Excursion  through  the 
principal  cities  of  Mexico  was  accomplished. 
The  purpose  was  to  get  a  "first  hand"  idea 
of  general  conditions  and  to  further  in 
every  possible  way  the  re-establishment  of 
commercial  relations  which  have  been  prac- 
tically suspended  during  the  ten-year  period 
of  revolution.  It  was  further  desired  to 
show  the  Mexican  people  that  the  feeling  of 
the  American  Nation  was  one  of  friendship 
and  kindly  interest  and  that  we  were  glad 
to  see  their  country  return  to  peace  and 
prosperity  and  anxious  to  witness  the  re- 
sumption of  International  commerce. 

The  trip  was  capably  managed  and  the 
entire  program  carried  out  as  originally 
planned.  Through  the  courtesy  of  the 
Mexican  Government  our  special  train  was 
met  at  the  International  border  at  Nuevo 
Laredo  by  Mr.  Santa  Marino,  Assistant 
Passenger  Agent  of  the  Nacionales  de  Mex- 
ico (Mexican  National  Railways),  who  took 
charge  and  made  the  trip  with  us.  The 
Mexican  Government  hauled  our  train  free 
of  charge  while  in  the  Republic.  I  have 
never  seen  a  train  run  on  better  schedule 
time. 

The  Mexican  Consul  at  Galveston,  Mr.  E. 
Meade  Fierros,  was  also  commissioned  by 
his  Government  to  make  the  trip  with  us 
and  rendered  very  valuable  assistance. 

I  shall  endeavor  to  cover  the  conditions 
and  things  of  interest  regarding  different 


MEXICO      TODAY 


places  in  which  we  stopped  in  the  order  of 
our  arrival  and  at  the  end  of  this  report 
will  make  a  resume  of  political,  financial, 
industrial  and  general  conditions  in  Mexico 
today. 

LAREDO,  TEXAS 

We  left  Houston  on  the  evening  of  Octo- 
ber 7th  and  arrived  at  Laredo  on  the  Ameri- 
can side  the  next  morning.  We  were  met  by 
the  Laredo  Chamber  of  Commerce  and 

fiven  a  very  interesting  ride  over  the  city, 
called  on  the  local  bankers,  who  expressed 
the  opinion  that  the  Mexican  political  trou- 
bles were  over  and  predicted  an  unprece- 
dented era  of  prosperity  for  Mexico.  They 
were  very  optimistic  over  the  outlook  for 
Laredo,  as  this  city  will  undoubtedly  be  the 
gateway  for  a  large  share  of  export  and  im- 
port commercial  dealings  with  Mexico.  I 
had  a  particularly  interesting  talk  with  Mr. 
Miles  T.  Cogley,  President  of  the  Milmo 
National  Bank  of  Laredo  and  also  Presi- 
dent of  the  Texas-Mexican  Railway.  He 
told  me  that  one  of  the  main  things  needed 
in  Mexico  now  was  for  American  railroad 
lines  to  allow  their  freight  cars  to  go  over 
into  Mexico  without  requiring  the  Mexican 
merchants  to  give  a  heavy  bond  against 
the  cars'  safe  return.  He  thinks  this  will 
be  done  soon,  as  the  Pullman  Company  has 
investigated  conditions  and  began  sending 
its  cars  across  to  all  the  principal  points 
in  Mexico  on  the  15th  of  October,  so  that 
now  one  can  travel  in  comparative  comfort 
there.  Another  pressing  need  mentioned 
by  Mr.  Cogley  was  the  building  of  a  rail- 
way line  from  Houston  direct  to  Laredo. 
This  is  being  actively  discussed  by  commer- 
cial organizations  all  along  the  proposed 
route. 

MONTEREY,  MEXICO 

We  crossed  the  Mexican  border  about 
one  o'clock  en  route  for  Monterey,  our  first 
stop  in  Mexico,  arriving  there  about  seven- 
thirty,  and  were  met  by  a  large  delegation 
of  Mexican  business  men  and  representa- 
tives of  the  Chamber  of  Commerce.  We 


MEXICO      TODAY 


were  taken  to  the  Foreign  Club,  where  a 
smoker  was  given  and  a  number  of  speeches 
made.  All  were  very  much  impressed  by 
the  sincere  expressions  of  good  will  for  the 
United  States  and  the  expressed  desire  to 
do  business  with  our  merchants  and  manu- 
facturers. We  began  there  to  revise  our 
opinion  that  the  Mexican  people  fostered  a 
dislike  for  Americans.  This  idea  was 
largely  due  to  incorrect  and  exaggerated 
items  which  have  been  published  from  time 
to  time  in  the  Press  of  both  countries. 

The  following  day  we  were  taken  for  a 
visit  to  the  principal  industries  and  places 
of  interest.  It  was  the  party's  first  trip 
through  a  typically  Mexican  city  and  we 
were  agreeably  surprised  to  find  on  every 
hand  evidences  of  work  and  industry. 
There  were  practically  no  signs  of  revolu- 
tion or  warfare.  The  street  cars  were  run- 
ning, factories,  foundries  and  mines  in  full 
operation  and  their  stores  all  open  and  ap- 
parently doing  a  brisk  business.  We  visited 
what  is  probably  the  largest  single  plant 
here,  the  Compania  Fundidora  de  Fierro  y 
Acero  de  Monterey,  S.  A.  It  has  a  capital 
of  ten  million  dollars  and  carries  an  ac- 
count with  a  prominent  New  York  bank. 
In  this  plant  they  are  very  busy  making  a 
number  of  products,  including  bolts,  nuts, 
pipe,  steel  railroad  rails,  car  wheels,  special 
castings  for  school  desks,  etc.,  and  also  re- 
building railroad  locomotives,  many  of 
which  were  practically  wrecked  during  the 
revolution.  This  plant  was  formerly 
operated  by  American  labor,  but  now  it  is 
run  almost  entirely  by  Mexican  labor.  The 
skill  displayed  by  some  of  these  men  at  the 
furnaces  and  in  the  rolling  mill  is  of  the 
highest  standard.  The  company  employs 
over  2,000  people  in  this  plant  and  the 
wages  run  from  2^  pesos  ($1.25)  for  com- 
mon labor  to  10  to  12  pesos  ($5  to  $6)  for 
skilled  labor  per  day.  In  the  nut  and  bolt 
department  we  found  boys  and  girls  of  13 
to  18  years  of  ige  operating  some  of  the 
machines.  There  is  a  crying  demand  in 
Mexico  for  all  of  the  company's  products.  It 
works  three  eight-hour  shifts,  using  fuel  oil 


MEXICO      TODAY 


from    Tampico    and    coal    from    Coahuila. 
Its  plant  covers  a  very  large  area. 

There  is  also  a  silver  and  gold  smelter 
close  by,  which  was  organized  by  Mexicans 
originally,  but  which  I  was  told  has  re- 
cently been  purchased  by  American  inter- 
ests. Here  there  is  also  one  of  the  largest 
breweries  in  Mexico,  where  the  famous 
"Carta  Blanca"  beer  is  made.  This  is  one 
of  the  leading  industries  of  Mexico  and  this 
particular  brewery  is  reported  to  be  making 
immense  profits.  We  also  visited  a  glass 
factory,  where  their  main  product  is  bottles 
and  drinking  glasses.  There  is  also  a  rope 
factory  here. 

A  Canadian  concern  owns  the  street  rail- 
way and  the  water  system,  which  is  said  to 
be  one  of  the  finest  in  the  Republic.  There 
are  several  private  banks  here.  The  Banco 
Nacional  de  Mexico,  which  was  formerly 
the  strongest  bank  in  Mexico,  has  been 
closed  during  the  past  trouble  and  the  only 
banks  in  Mexico  now  are  private  banks. 

Mr.  Adolfo  Zambrano,  Jr.,  of  the  bank- 
ing firm  of  A.  Zambrano  e  Hijos  was  par- 
ticularly courteous  to  me  and  gave  me  very 
valuable  information  about  banking  condi- 
tions in  Mexico.  His  bank  is  establishing 
branches  in  the  principal  cities  of  Mexico 
and  their  deposits  are  said  to  be  increasing 
very  rapidly.  They  have  modern  banking 
methods,  Burroughs  statement  system  and 
beautiful  fixtures.  They  open  credits  in 
New  York  for  their  Mexican  customers  who 
are  buying  goods  in  the  States.  These  banks 
are  allowed  interest  on  their  daily  balances 
by  their  New  York  correspondents.  Their 
foreign  exchange  service  involves  daily 
telegraphic  communication  with  New 
York.  They  also  maintain  balances  with 
Texas  border  banks.  For  commercial  loans 
to  their  customers  they  charge  an  average 
of  18  per  cent  per  annum.  The  reason  for 
this  seemingly  high  rate  of  interest  will  be 
dealt  with  later.  Mr.  Zambrano  said  the 
cryi'ng  need  of  his  country  was  for  finan- 
cial assistance  from  the  banks  of  the  United 
States.  He  seemed  anxious  to  have  Ameri- 
can banks  enter  the  Mexican  field  and  said 


MEXICO      TODAY 


they  could  do  so  with  perfect  safety  and 
that  the  returns  would  be  entirely  satis- 
factory. 

Monterey  is  primarily  a  mining  city;  the 
farming  situation  is  not  very  promising. 
The  land  is  very  dry  and  hard  and  nothing 
seems  to  grow  except  several  species  of 
cactus.  It  is  claimed  that  when  irrigated 
it  is  very  productive,  but  that  step  seems 
quite  a  long  way  off.  The  population  of 
Monterey  is  approximately  85,000  and  it  is 
the  capital  of  the  State  of  Nuevo  Leon. 

TAMPICO 

We  left  Monterey  on  the  evening  of  Oc- 
tober 10th  and  arrived  in  Tampico  the 
morning  of  the  llth.  We  had  heard  won- 
derful stories  of  the  great  Tampico  oil 
fields  and  having  visited  most  of  our  Texas 
and  Oklahoma  oil  fields  I  thought  I 
knew  what  to  expect,  but  the  operations 
in  that  field  were  so  stupendous  that  I  was 
very  much  awed  at  the  magnitude  of  things. 
As  we  approached  Tampico,  for  several 
miles  along  the  Panuco  River  we  saw  a 
solid  line  of  wharves,  refineries  and  oil 
tankers  on  both  sides  of  the  river,  and  on 
the  higher  ground  back  from  the  river  was 
an  almost  endless  row  of  large  storage 
tanks.  We  arrived  at  the  station  to  find 
it  a  long,  lew,  dilapidated  shack  and  piled 
high  with  all  kinds  of  freight,  etc.  It  all 
seemed  confusion.  This  same  condition  is 
seen  at  the  Customs  House  and  is  one  of 
the  most  serious  drawbacks  to  the  mer- 
chants and  oil  companies  of  Tampico.  There 
is  such  a  large  quantity  of  freight  and  sup- 
plies handled  through  the  port  of  Tampico 
that  it  is  simply  swamped.  They  are  try- 
ing, however,  to  enlarge  their  facilities  and 
hope  to  remedy  this  situation.  Of  course, 
the  chief  reason  for  Tampico's  commercial 
status  is  oil  and  from  a  standpoint  of  com- 
mercial importance  Tampico  now  ranks  as 
high,  if  not  higher,  than  any  other  Mexican 
city.  The  transportation  facilities  by  water 
into  Tampico  and  the  railroads  into  the 
interior  make  it  fairly  certain  that  Tampico 
will  always  be  a  prominent  commercial  cen- 


MEXICO      TODAY 


ter,  even  though  the  oil  fields  are  exhausted. 
I  am  taking  the  liberty  here  of  inserting  an 
excerpt  from  a  letter  written  me  by  a  gen- 
tleman whom  I  met  in  Tampico  and  who 
has  lived  there  for  about  six  years,  appears 
to  know  the  conditions  well,  speaks  the 
language  fluently  and  has  apparently  made 
quite  a  success  of  his  operations.  He 
writes  in  part  as  follows: 

"This  is  the  first  time  since  the  overthrow  of 
Diaz  that  all  the  various  factions  here  in  Mexico 
have  been  united  and  working  in  perfect  harmony. 
The  Mexicans  are  sick  and  tired  of  fighting  and 
they  are  demonstrating  their  honest  desire  to  go 
to  work  and  assist  in  establishing  a  permanent 
government  and  restore  normal  conditions  in 
Mexico.  General  Alvaro  Obregon,  president-elect 
of  Mexico,  is  a  broad-minded,  progressive  man, 
and  everybody  seems  to  be  of  the  opinion  that 
he  is  THE  ONE  man  to  establish  a  firm  govern- 
ment along  substantial,  progressive,  conservative 
and  unselfish  lines.  Furthermore,  General  Obre- 
gon and  all  his  followers  very  clearly  realize  that 
in  order  to  establish  and  maintain  such  a  govern- 
ment in  Mexico,  they  must  have  the  moral  and 
financial  support  of  the  United  States  and  they 
are  constantly  showing  a  most  pronounced  de- 
sire to  create  a  better  feeling  between  Mexico 
and  the  United  States  and  to  extend  ample  pro- 
tection and  guarantees  to  both  life  and  property 
of  foreigners  and  encourage  the  investment  of 
foreign  capital  in  Mexico  to  assist  in  the  develop- 
ment of  the  wonderful  resources  of  this  country. 
In  other  words,  the  Mexicans  are  sick  and  tired 
of  fruitless  revolutions  and  the  officials  are  really 
honestly  and  unselfishly  laboring  to  establish  a 
firm  and  permanent  government  along  broad  con- 
structive lines  and  regain  for  Mexico  the  position 
of  honor  and  respect  which  she  once  enjoyed 
among  the  nations  of  the  world.  All  of  which 
means  that  the  future  political  outlook  for  Mex- 
ico is  more  encouraging  than  it  has  been  for  ten 
years. 

"Tampico  occupies  a  very  peculiarly  unique 
position  as  compared  with  other  cities  of  Mexico; 
in  fact,  she  is  absolutely  independent  of  the  rest 
of  the  Republic.  She  has,  of  course,  the  greatest 
oil  field  the  world  has  ever  known  and  the  con- 
sensus of  opinion  of  the  leading  oil  men  is  that 
this  field  has  merely  been  scratched  from  a  stand- 
point of  development  and  they  estimate  the  life 
of  this  field  to  continue  at  least  ten  years  yet. 
A  casual  observation  of  the  enormous  investments 
in  refineries,  terminals,  wharfs,  tank  farms,  pipe 
lines,  tank  steamers,  office  buildings  and  resi- 
dences by  the  oil  companies  on  such  an  elaborate 
and  permanent  basis,  will  immediately  convince 
one  of  the  confidence  the  oil  companies  have  in 
the  future  of  this  field.  Apart  from  the  oil  indus- 


MEXICO      TODAY 


try,  the  commercial  importance  of  Tampico  is 
very  great.  She  has  one  of  the  finest  natural  har- 
bors on  the  American  continent;  the  geographical 
location  of  Tampico  makes  her  the  most  logical 
point  through  which  all  imports  and  exports  to 
and  from  all  central  and  northeastern  Mexico  will 
pass;  Tampico  is  surrounded  on  three  sides  by 
as  fertile  agricultural  land  as  can  be  found  on  the 
American  continent.  All  kinds  of  tropical  and 
semi-tropical  fruits  and  vegetables  grow  in  abund- 
ance the  year  round;  sugar  cane,  coffee,  rice, 
tobacco,  vanilla  beans,  corn  and  beans  yield  boun- 
teously in  this  region;  the  sisal  industry  has  just 
begun  to  be  developed  on  a  big  scale  in  this 
state  and  is  proving  to  be  of  better  quality  and 
more  profitable  than  is  obtained  in  Yucatan;  cat- 
tle and  live-stock  of  all  kinds  thrive  exceedingly 
well  here;  there  is  an  enormous  quantity  of  hard 
wood  timber  along  this  coast;  the  fishing  industry 
offers  wonderful  opportunities;  the  winter  climate 
is  most  agreeable,  and  the  great  quantity  of  wild 
game  such  as  small  black  bear,  tiger,  turkey, 
geese,  duck  and  also  fish,  offer  attractive  induce- 
ments to  men  who  like  this  kind  of  sport. 

"With  all  these  resources  and  with  transporta- 
tion facilities  to  all  parts  of  the  world,  and  the 
fact  that  most  all  products  shipped  to  and  from 
the  Central  and  Northeastern  section  of  Mexico 
will  have  to  pass  through  here,  it  seems  inevitable 
that  Tampico  will  soon  develop  into  a  very  im- 
portant manufacturing,  industrial  and  shipping 
center,  because  with  a  few  years  of  peace  in  Mex- 
ico, these  resources  must  be  developed. 

"However,  eliminating  the  future  possibilities, 
Tampico,  with  her  100,000  inhabitants,  is  at  pres- 
ent a  rapidly  growing,  thriving,  progressive,  busy 
city  with  American  ideas  and  principles  predomi- 
nating. And,  furthermore,  just  so  long  as  there 
is  a  barrel  of  oil  to  be  had  from  this  field,  it 
doesn't  matter  'what  the  conditions  might  be  in 
other  parts  of  Mexico  nor  who  is  president  of  the 
United  States,  the  world  must  have  this  oil, 
which  means  that  Tampico  will  continue  to  enjoy 
unmolested  prosperity." 

There  are  at  present  two  principal  oil  fields 
near  Tampico,  viz:  the  Panuco  field  and 
the  South  Coastal  field  which  lies  south 
of  Tampico  in  the  State  of  Vera  Cruz.  We 
made  a  trip  through  the  Coastal  field  and 
saw  some  of  those  wonderful  wells  that 
have  been  producing  enormous  quantities 
of  oil  for  so  long  a  time.  They  are  still 
bringing  in  new  wells  and  extending  the 
field.  The  outlook  seems  very  promising. 
The  wells  come  in  at  a  depth  of  around 
3,000  feet.  Nearly  all  of  the  larger  oil  com- 
panies in  the  State  have  holdings  there. 


MEXICO      TODAY 


The  British  companies  are  very  strong. 
The  Corona  Oil  Company  is  controlled  by 
the  Royal  Dutch-Shell  interests  and  the 
Mexican  Eagle  (Compania  Mexicana  de  Pe- 
troleo  "El  Aguila"),  which  was  the  Lord 
Cowdray  Company,  is  also  managed  and 
controlled  by  the  Royal  Dutch-Shell  inter- 
ests. 

Tampico  has  a  population  of  around  100,- 
000  and  there  are  about  8,000  Americans  in 
and  around  the  city.  The  payrolls  of  the 
oil  companies  amount  to  three  million  dol- 
lars per  month.  From  a  business  stand- 
point, Tampico  reflects  possibly  more  than 
any  other  Mexican  city  the  up-to-date  ideas 
and  methods  brought  there  by  Americans 
and  other  foreigners.  There  is  an  enormous 
amount  of  foreign  capital  invested  here  in 
connection  with  the  oil  industry.  The  resi- 
dential addition  to  the  city,  known  as  the 
Aguila  Colony,  where  most  foreigners  live, 
has  a  pretty  location  and  has  some  really 
beautiful  homes.  The  cost  of  the  average 
cottage  in  this  section  is  around  $15,000  gold. 
Tampico  is  growing  very  rapidly  and  is 
very  crowded.  It  is  difficult  to  get  hotel 
and  living  accommodations  and  at  night 
certain  streets  are  rilled  with  native  families 
sleeping  out  in  the  open.  The  climate  is 
hot  and  Tampico  has  the  reputation  of  be- 
ing very  unhealthful  for  foreigners,  but  they 
are  clearing  away  the  underbrush  near  the 
city,  fighting  mosquitoes  and  already  con- 
ditions are  much  improved.  Before  we  ar- 
rived in  Tampico,  both  the  American  and 
Mexican  newspapers  printed  reports  of  an 
epidemic  of  yellow  fever  there,  but  we  found 
this  untrue.  The  authorities  told  us  that 
there  was  only  one  case  in  the  city  and  that 
it  was  recovering.  They  have  some  very 
live  business  organizations  which  are  work- 
ing together  for  the  commercial  growth  of 
the  city.  The  Mexican  Chamber  of  Com- 
merce, the  American  Chamber  of  Commerce 
and  the  Foreign  Club  are  all  very  industri- 
ous bodies.  There  are  apparently  great  op- 
portunities in  this  city  for  new  enterprises. 
For  example,  they  need  a  telephone  system. 
There  is  only  a  semblance  of  a  system, 

8 


MEXICO      TODAY 


which  is  owned  by  Germans.  There  are 
only  a  few  telephones  in  the  city  and  the 
people  get  practically  no  service.  Further, 
they  do  not  have  natural  gas  distribution 
through  the  city,  when  within  a  few  miles 
one  well,  belonging  to  the  Texas  Company, 
is  discharging  as  a  total  loss  55  million  cubic 
feet  of  gas  per  day  and  another,  owned  by 
the  American  Fuel  Oil  Company  of  Cleve- 
land, is  letting  go  to  waste  29  million  cubic 
feet  daily.  What  are  apparently  wonderful 
opportunities  for  money  making  stare  at 
one  from  every  side  and  the  people  who  live 
there  all  say  that  their  crying  need  is  for 
capital  to  develop  their  natural  resources. 
The  agricultural  possibilities  around  Tam- 
pico  are  very  inviting.  It  is  a  tropical  re- 
gion and  the  land  is  very  rich.  All  kinds 
of  tropical  farming  is  carried  on  with  great 
success.  The  local  merchants,  both  native 
and  foreign,  say  they  are  greatly  handi- 
capped by  the  lack  of  banking  facilities  and 
they  are  extremely  anxious  for  our  American 
banks  to  come  in  and  do  business  with 
them.  Among  the  main  banks  there  are 
the  Tampico  Banking  Company,  S.  A.,  The 
Petroleum  Banking  &  Trust  Company,  S.  A., 
and  a  branch  of  the  Banque  Francaise  du 
Mexique,  which  has  its  head  office  in  Mexico 
City  and  was  formerly  called  Lacaud  e  Hijo 
(Lacaud  &  Son).  The  big  oil  companies  do 
not  carry  large  balances  in  Tampico  as  they 
maintain  their  major  accounts  in  the  States. 
The  local  banks  open  credits  with  their  New 
York  and  border  bank  correspondents  in 
favor  of  their  local  customers.  What  they 
say  they  need  is  to  have  large  banking  in- 
stitutions that  will  advance  credit  for  the 
opening  of  documentary  Letters  of  Credit  in 
favor  of  approved  Mexican  merchants,  which 
credit  the  local  bank  would  usually  guar- 
antee. This  would  finance  the  operation  of 
buying  goods  during  the  period  of  shipment 
to  Mexico,  which  consumes  ordinarily  from 
thirty  to  sixty  days,  and  would  solve  a  great 
problem  for  both  the  Mexican  merchant  and 
the  local  banks.  In  order  to  perfect  an  ar- 
rangement of  this  nature,  it  would  be  nec- 
essary for  the  New  York  bank  to  have  some 
one  on  the  ground  to  check  the  credit  of  the 


MEXICO      TODAY 


concerns  it  proposed  doing  business  with 
and  also  to  have  a  close  connection  with 
a  local  bank  in  which  it  had  confidence, 
which  bank  could  look  after  the  payment  of 
documents  on  arrival  of  the  goods.  Of 
course  there  are  certain  well-rated  firms  in 
Mexico  who  prefer  having  an  established 
line  of  credit  and  carrying  an  open  account 
with  a  New  York  bank,  exactly  as  business 
houses  in  the  States  do.  For  any  credit 
accommodations  extended  to  Mexican  com- 
mercial houses  a  very  attractive  rate  of 
interest  could  be  obtained.  The  straight 
loans  which  are  made  by  the  Tampico  banks 
to  their  customers  bear  an  exceptionally 
high  rate  of  interest,  some  loans  being  re- 
ported on  a  basis  of  24  to  36  per  cent  in- 
terest rate.  The  demand  is  great  for  money 
here  and  these  high  interest  rates  do  not 
indicate  that  there  is  an  undue  element  of 
chance  taken,  as  the  best-rated  concerns  pay 
these  rates. 

SAN  LUIS  POTOSI 

Our  train  left  Tampico  at  noon  on  the 
14th  for  San  Luis  Potosi.  The  country  is 
very  pretty  between  these  cities.  One  first 
passes  through  the  tropical  section  and  then 
when  the  climb  up  the  mountain  begins  it 
is  beautiful  indeed.  The  mountains  in  this 
section  are  different  from  the  mountains  in 
North  Central  Mexico,  being  covered  with 
foliage,  and  have  not  the  barren  surface  of 
those  of  the  interior.  The  railroad  up  these 
mountains  is  a  wonderful  bit  of  engineering 
as  it  traverses  a  very  irregular  country.  We 
arrived  in  San  Luis  Potosi  the  morning  of 
the  15th.  It  is  a  city  of  60,000  to  70,000 
population  and  is  noted  over  Mexico  for  its 
beauty  and  cleanliness.  It  has  numerous 
plazas  and  cathedrals  and  its  streets  are 
kept  spotlessly  clean.  We  were  met  by  the 
Mexican  Chamber  of  Commerce  and  given 
a  ride  over  the  city,  after  which  we  were 
entertained  at  a  luncheon  at  the  Chamber 
of  Commerce  Building.  A  number  of 
speeches  were  made  and  we  were  again  im- 
pressed by  the  earnestness  of  the  Mexican 
business  men  in  their  desire  to  establish  com- 
mercial relations  with  the  United  States.  I 

10 


MEXICO      TODAY 


called  on  the  Zambrano  e  Hijo  Bank  and 
the  Banque  Francaise  du  Mexique. 

The  interests  of  San  Luis  Potosi  are 
mainly  agricultural,  but  there  are  some  valu- 
able salt  mines  nearby.  Much  of  the  land 
around  this  city  is  under  irrigation  and 
the  crops  were  very  fine  indeed.  There  is 
a  very  apparent  lack  of  up-to-date  farming 
implements  and  modern  pumps  for  irriga- 
tion, and  one  sees  crude  home-made  plows 
on  every  side  and  queer  mule-power  contriv- 
ances being  used  for  pumps  to  raise  the 
water  into  the  irrigation  ditches.  Mexico 
certainly  needs  farming  machinery  badly 
and  presents  a  wide  field  for  any  of  our 
implement  houses  who  will  seek  business 
there.  The  stores  of  the  city  appeared  to 
be  well-stocked  and  doing  a  good  business. 
We  also  noticed  quite  a  lot  of  building  and 
construction  going  on. 

In  the  evening  we  were  entertained  at 
a  banquet  by  the  governor  of  the  State  of 
San  Luis  Potosi,  who  repeated  the  desire 
expressed  by  the  merchants  for  closer  com- 
mercial relations  and  promised  adequate  pro- 
tection to  Americans  who  wished  to  either 
live  in  Mexico  or  make  investments  there. 

QUERETARO 

We  left  San  Luis  Potosi  the  night  of  the 
15th  and  arrived  in  Queretaro  the  morning 
of  the  16th. 

Queretaro  is  very  prominent  in  Mexican 
history,  as  it  has  several  times  been  the  loca- 
tion of  the  Government  when,  under  stress, 
it  had  to  flee  from  Mexico  City.  It  was  also 
the  scene  of  Maximilian's  capture  and  exe- 
cution. The  Austrian  Government  has  erect- 
ed a  chapel  over  the  spot  where  he  was 
executed  and  once  a  year  sends  priests  to 
hold  memorial  services.  Maximilian,  with- 
out doubt,  did  more  toward  bringing  civili- 
zation and  art  to  Mexico  than  anyone  else 
and  traces  of  this  are  to  be  noted  in  all  parts 
of  the  country.  Mexico  is  famed  for  its 
palatial  government  buildings  and  palaces 
and  Maximilian  was  largely  responsible  for 
these.  Queretaro  is  one  of  the  oldest  cities 

11 


MEXICO      TODAY 


of   Mexico   and   has   many   very   beautiful 
cathedrals. 

MEXICO  CITY 

From  Queretaro  we  went  to  Mexico  City, 
arriving  there  Saturday  evening,  October 
16th.  We  were  furnished  accommodations 
at  the  Regis  Hotel  during  our  stay  of  six 
days.  We  had  Sunday  to  rest  and  go  sight- 
seeing. Mexico  City  is  one  of  the  most 
beautiful  and  picturesque  cities  on  the 
American  continent.  It  has  numbers  of  very 
handsome  government  buildings,  cathedrals, 
palatial  residences,  modern  office  buildings, 
etc.  It  has  the  air  of  an  American  city  in 
the  streets  and  in  the  business  section,  the 
streets  of  which  are  well  laid  out,  paved  and 
lighted.  It  is  noted  for  its  beautiful  boule- 
vards, drives  and  places  of  interest,  chief 
among  which  are  the  castle  and  grounds  of 
Chapultepec,  Xochimilco  and  its  floating 
gardens,  and  Popocatepetl.  It  has  an  alti- 
tude of  over  9,000  feet  and  the  climate  is 
cool  and  delightful.  There  are  many  for- 
eigners there.  Before  their  recent  revolu- 
tions there  were  large  numbers  of  Ameri- 
cans there,  but  most  of  them  left,  though 
they  are  beginning  to  return  now.  I  am 
told  that  Americans  were  never  really  mo- 
lested in  Mexico  City  and  the  attitude  of 
the  Mexicans  now  is  certainly  very  friendly. 

Monday  we  were  given  a  luncheon  by  the 
Mexican  Chamber  of  Commerce  of  Mexico 
City  in  its  building,  at  which  were  present  a 
number  of  El  Paso,  Texas,  business  men 
who  were  touring  Mexico  for  the  same  pur- 
pose we  were.  The  president  of  the  Cham- 
ber of  Commerce  made  a  very  forceful 
address  in  which  he  stated  that  the 
percentage  of  failures  of  merchants  in  Mex- 
ico was  smaller  than  in  any  other  country. 
He  especially  urged  American  banks  to  come 
into  Mexico  and  assured  them  they  would 
have  every  assistance  possible  and  complete 
protection.  He  did  not  see  the  wisdom  of 
America  lending  money  to  Europe  and  help- 
ing them  when  our  next-door  neighbor,  Mex- 
ico, needed  help  so  badly,  especially  when 
those  same  Europeans,  he  said,  used  that 

12 


MEXICO      TODAY 


money  to  come  over  into  Mexico  and  com- 
pete with  us.  He  stated  that  several  Eu- 
ropean countries  were  already  beginning  to 
exploit  the  Mexican  trade  fields  and  urged 
us  to  come  in  before  it  was  too  late.  He 
regretted  the  fact  that  American  mer- 
chants and  manufacturers  did  not  give  more 
attention  to  Mexican  business  and  to  the 
shipping  and  packing  of  goods  for  export 
to  Mexico.  He  also  urged  our  merchants 
and  manufacturers  to  give  reasonable  credit 
terms  to  Mexicans  and  said  they  would  re- 
ceive us  with  open  arms  if  we  would  only 
come  in.  There  are  5,000  Mexican  merchants 
in  Mexico  City  who  are  members  of  the 
Chamber  of  Commerce,  and  he  says  these 
concerns  will  meet  their  credit  obligations 
as  readily  as  any  class  of  business  men  in 
the  world.  They  need  our  help  to  develop 
Mexico's  wonderful  natural  resources.  He 
ended  by  again  saying  that  Americans  need 
have  no  fear  about  coming  to  Mexico  and 
investing  their  capital,  and  stated  that  the 
Mexico  City  Chamber  of  Commerce  stood 
ready  to  help  in  every  way  possible  any 
one  who  wished  to  enter  this  field. 

The  next  day  our  party  was  presented  to 
Provisional  President  de  la  Huerta.  We 
were  first  shown  through  the  National  Pal- 
ace, which  is  a  marvel  of  luxury  and  ele- 
gance. There  are  numbers  of  large  recep- 
tion rooms,  ante-chambers,  cabinet  rooms 
and  private  offices,  all  exquisitely  appointed 
with  the  most  expensive  and  artistic  fur- 
nishings imaginable.  When  we  had  finished 
our  visit  through  the  Palace  we  then  met 
President  Adolfo  de  la  Huerta,  who  at  once 
impresses  one  as  being  very  capable  and 
resourceful,  and  although  he  has  a  very  quiet 
bearing  and  manner  of  speech  you  somehow 
get  the  impression  that  he  has  a  very  strong 
will  and  the  nerve  to  back  up  his  convic- 
tions. He  is  a  young  looking  man,  appar- 
ently about  43  or  44.  There  can  be  no 
denying  that  since  he  has  been  in  office  he 
has  worked  wonders  in  his  country.  Sta- 
tistics show  that  the  efficiency  of  the  rail- 
roads has  increased  over  30  per  cent  during 
his  incumbency.  For  the  first  time  in  ten 

13 


MEXICO      TODAY 


years  there  are  today  no  armed  factions 
opposing  the  Government  and  everyone 
seems  to  realize  how  much  better  off  they 
are  under  the  new  order  of  things  and  seems 
to  want  to  aid  the  present  Government  in 
every  way  possible.  President  de  la  Huerta 
is  very  popular  throughout  Mexico.  He  will 
return  to  his  former  position  as  Governor 
of  Sonora  when  President-elect  Alvaro 
Obregon  takes  office  next  month.  President 
de  la  Huerta  made  an  address  in  which  he 
stated  that  the  present  Government  was 
absolutely  stable.  He  said  numerous  strikes 
had  been  amicably  settled,  that  factories  and 
industries  were  re-opening  and  people  re- 
turning to  productive  work,  and  that  during 
his  regime  no  foreign  capital  had  been  mo- 
lested; further,  that  wages  in  Mexico  had 
not  advanced  since  1912  and  consequently 
the  laboring  Mexican  found  it  hard  to  meet 
the  high  cost  of  living,  but  he  felt  con- 
fident that  as  soon  as  the  country  got  on  a 
more  productive  basis  this  matter  would  be 
remedied.  He  is  very  anxious  for  Ameri- 
cans to  enter  Mexico.  He  says  there  is 
room  for  all  and  guarantees  complete  pro- 
tection to  Americans  and  their  enterprises. 
He  is  giving  attention  to  schools  and  says 
he  realizes  that  through  education  of  the 
lower  classes  there  will  be  brought  about 
a  better  understanding  of  the  principles  of 
liberty  and  justice  as  we  have  them  in  our 
country  and  this  will  absolutely  do  away 
with  internal  revolutions.  The  President 
impressed  everyone  present  as  being  very 
sincere  in  his  desire  to  be  of  service  to  his 
country  and  to  establish  closer  relations 
with  the  United  States.  He  also  referred 
to  our  Government  and  said  that  he  hoped 
we  would  not  defer  recognition  of  the  Mexi- 
can Government  long  as  it  would  greatly 
help  them  in  getting  their  country  on  its 
feet  to  have  our  help  and  support. 

I  called  on  General  Salvador  Alvarado, 
the  Minister  of  Finance  of  Mexico  while  I 
was  in  the  city.  Not  having  arranged  pre- 
viously for  an  audience  with  him  I  was  told 
by  friends  familiar  with  the  circumstances 
that  it  was  very  unlikely  that  I  would  be 

14 


MEXICO      TODAY 


able  to  see  the  General  as  he  was  probably 
the  busiest  man  in  Mexico.  When  I  ar- 
rived at  the  National  Palace  and  was  shown 
the  Treasury  Department  I  felt  sure  that 
this  prediction  was  true  as  there  were  sev- 
eral ante-rooms  filled  with  people  waiting 
for  an  audience,  but  immediately  upon  pre- 
senting my  card  bearing  the  name  of  The 
American  Exchange  National  Bank,  New 
York,  I  was  admitted  to  General  Alvarado's 
office.  Some  of  the  people  outside  had  been 
waiting  several  days  for  an  interview  with 
the  General.  He  recalled  with  great  pleasure 
the  courtesies  extended  him  by  our  bank 
while  he  was  in  New  York.  He  especially 
asked  to  be  remembered  to  our  president, 
Mr.  Lewis  L.  Clarke,  and  our  other  officers. 
General  Alvarado  told  me  that  Mexico's 
future  looked  particularly  bright  now;  that 
everyone  seemed  to  earnestly  desire  peace. 
He  said  that  from  a  financial  standpoint 
each  day  showed  improvement.  The  rail- 
roads are  rapidly  restoring  their  service  and 
the  revenue  therefrom  is  correspondingly 
larger.  The  rolling  stock  is  being  rapidly 
repaired  and  put  into  service.  He  also  men- 
tioned the  great  need  of  Mexico  for  outside 
financial  help  and  said  that  he  would  render 
any  assistance  within  his  power  to  our  bank 
or  any  other  bank  that  would  enter  the 
Mexican  field.  He  said  there  was  room  for 
many  new  banks  in  the  country.  He 
was  exceptionally  cordial  and  courteous  to 
me  and  offered  to  assist  me  in  any  way  he 
could  during  my  stay  in  Mexico. 

I  had  a  very  interesting  visit  with  Mr. 
Edwin  W.  Sours,  general  agent  for  R.  G. 
Dun  &  Company  in  Mexico.  Mr.  Sours  told 
me  that  credit  conditions  were  much  better 
in  Mexico  than  Americans  thought.  He 
said  his  organization  had  very  complete 
credit  files  on  the  Mexican  houses  and  that 
the  average  Mexican  business  man  was 
prompt  in  meeting  his  obligations.  He  said 
that  prospects  were  very  encouraging  and 
that  there  appeared  to  be  an  unprecedented 
era  of  prosperity  before  Mexico.  While 
there  are  branches  of  two  or  three  European 
and  Canadian  banks  in  Mexico  City,  and 

15 


MEXICO      TODAY 


several  private  banks,  it  would  appear  that 
here,  as  in  other  cities  of  Mexico,  there  is 
a  need  for  greater  banking  facilities. 

During  our  stay  we  were  shown  every 
consideration  and  courtesy  by  both  the  Fed- 
eral and  municipal  authorities  and  met  sev- 
eral of  the  cabinet  ministers  and  the  mayor. 
We  were  shown  the  principal  places  of 
interest  and  given  several  banquets  and  re- 
ceptions. Mexico  City  presents  today  the 
unmistakable  signs  of  renewed  commercial 
activity  and  the  merchants  are  looking  for- 
ward to  peace  and  prosperity  and  making 
their  plans  accordingly.  Many  of  them  are 
seeking  to  handle  the  lines  of  American 
houses  in  Mexico.  One  noticeable  feature 
in  Mexico  City  is  the  very  large  number  of 
automobiles.  Most  of  them  are  American 
cars,  with  a  few  European  makes. 

GUADALAJARA 

After  our  six-day  stay  in  the  city  we 
left  on  October  22nd  for  Guadalajara  and 
arrived  there  the  morning  of  the  23rd. 
Guadalajara  is  the  second  largest  city  in 
Mexico  and  is  very  pretty.  It  is  situated  in 
a  fine  agricultural  section  on  the  Pacific 
slope  and  has  mining  enterprises  of  con- 
siderable importance  nearby.  The  section 
of  the  city  known  as  the  Foreign  Colony  con- 
tains many  beautiful  homes  of  American  and 
European  architecture.  Before  the  revolu- 
tion there  were  large  colonies  of  Americans, 
English,  French  and  Germans,  but  many 
Americans  and  English  left.  There  are  large 
numbers  of  Germans  who  make  their  home 
here.  Most  of  the  leading  stores  are  owned 
by  them  and  they  handle  German  goods  al- 
most exclusively  and  advertise  them  exten- 
sively. 

The  merchants  of  Guadalajara  seemed 
to  be  handicapped  by  the  lack  of  adequate 
banking  facilities.  There  are  several  small 
private  banks  here,  but  they  are  not  large 
enough  to  furnish  sufficient  credit  to  the 
commercial  houses  and  really  specialize  on 
their  foreign  exchange  trading. 

Unskilled    labor   around    Guadalajara    is 
16 


MEXICO      TODAY 


paid  one  peso  (50c  gold)  per  day  and  car- 
penters, masons,  blacksmiths,  etc.,  earn  two 
pesos,  or  $1.00  gold,  per  day.  Guadalajara 
would  seem  to  be  an  ideal  place  for  factory 
sites,  as  it  has  an  abundance  of  cheap 
electric  power  generated  by  the  enormous 
water  falls  nearby.  Only  about  5,000  H.  P. 
of  this  is  used  at  present  and  it  is  estimat- 
ed that  300,000  H.  P.  is  daily  going  to  waste. 
The  Southern  Pacific  Railroad  has  its  ter- 
minal in  Guadalajara,  and  as  soon  as  it 
completes  about  125  miles  of  track,  on 
which  it  is  now  working,  will  have  a  direct 
line  from  Los  Angeles  to  Guadalajara, 
which  will  open  a  very  rich  section  of  coun- 
try along  the  Pacific  Coast. 

There  are  some  very  beautiful  places,  of 
interest  around  Guadalajara,  chief  among 
which  is  Lake  Chapala,  which  is  a  very 
large  lake,  situated  among  the  mountains. 
Guadalajara  has  an  altitude  of  some  5,000 
feet  and  is  noted  for  its  even  and  delight- 
ful climate.  It  is  claimed  the  sun  shines  365 
days  every  year.  There  is  a  very  fine 
waterworks  system.  The  population  is  es- 
timated at  around  200,000,  although  there 
appears  to  be  no  accurate  census. 

LEON  AND   AGUASCALIENTES 

From  Guadalajara  we  started  our  north- 
bound trip,  leaving  there  on  October  26th. 
We  stopped  a  few  hours  at  the  City  of 
Leon,  which  has  a  population  of  about  30 
to  40  thousand.  It  is  a  typical  Mexican 
city.  We  went  on  to  Aguascalientes,  ar- 
riving there  in  the  afternoon  and  spent  sev- 
eral hours.  It  is  the  capital  of  the  State  of 
Aguascalientes,  and  noted  for  its  hot  baths. 

TORREON 

We  left  Aguascalientes  the  night  of  the 
26th  and  arrived  at  Torreon  on  the  morn- 
ing of  the  27th.  We  were  met  by  the  local 
Chamber  of  Commerce  and  taken  for  a  ride 
over  the  city.  The  principal  industries  of 
this  section  are  mining,  cotton  and  guayule. 
There  are  several  large  mines  and  smelters 
located  here,  and  there  are  also  cotton  mills. 
In  this  section  they  raise  large  quantities  of 

17 


MEXICO      TODAY 


cotton,  which  is  of  a  very  high  grade.  They 
produce  the  famous  "Imperial  Valley" 
staple.  While  we  were  in  Torreon  I  talked 
with  several  cotton  men,  who  told  me  that 
cotton  was  then  selling  at  24c  per  pound 
when  the  same  grade  in  the  States  was 
selling  at  19c.  They  said  some  Texas  cot- 
ton was  being  imported  by  their  mills  at 
that  time.  We  visited  the  smelters  and 
were  then  taken  to  the  guayule  factory. 
Guayule  is  a  low  grade  rubber  which  is 
used  as  a  filler  and  in  the  manufacture  of 
belting,  etc.  It  comes  from  a  plant  which 
resembles  a  weed  and  grows  wild  and  in 
great  quantities  all  over  the  surrounding 
country.  This  rubber  is  partially  refined  in 
Torreon  and  then  shipped  to  the  States. 
Most  of  the  large  interests  are  owned  by 
American  capital. 

They  were  having  a  very  hot  political 
campaign  between  the  conservatives,  who 
styled  themselves  the  "Black  and  Red" 
party,  and  the  socialists  or  radicals,  who 
called  their  party  the  "Reds."  It  was  the 
opinion  that  the  conservatives  would  win 
easily.  There  have  been  labor  agitators  at 
work  in  this  section,  and  they  have  caused 
quite  a  bit  of  industrial  strife.  The  main 
labor  trouble,  however,  is  among  the  coal 
miners  of  the  State,  and  since  leaving  Mex- 
ico I  have  seen  in  the  papers  that  the  Gov- 
ernment has  taken  over  the  mines  of  Coa- 
huila  and  is  operating  them,  claiming  that 
the  -coal  is  essential  for  the  railroads  and 
other  important  enterprises.  The  Govern- 
ment states  that  this  is  not  confiscation  and 
that  the  mine  owners  will  receive  their  le- 
gitimate profit. 

SALTILLO 

Leaving  Torreon  on  the  night  of  the 
28th  we  arrived  in  Saltillo  the  morning  of 
the  29th.  Saltillo  is  a  very  progressive  city, 
having  as  its  main  industry  mines  which 
produce  gold,  silver,  lead,  zinc,  coal,  etc., 
in  great  quantities.  There  are  a  number  of 
both  American  and  European  mining  inter- 
ests here.  Saltillo  is  a  very  pretty  city  and 
is  noted  for  its  schools,  chief  among  which 

18 


MEXICO      TODAY 


is  the  State  Normal  School  for  Teachers. 
This  school  occupies  a  very  handsome  build- 
ing and  its  methods  are  very  modern.     It 
compares  favorably  with  our  schools.   They 
take  the  small  children  of  the  kindergarten 
age  and  give  them  all  necessary  courses  in 
this    one    school    until    they    graduate    as 
teachers.      They    give    considerable    atten- 
tion to  the  physical  side  of  the  child's  de- 
velopment   and    are    introducing    all    the 
American    games    and    sports    which    our 
children  play.    The  pupils  are  exceptional ly 
clean  and   well  dressed.     A  program   was 
rendered    by    the    school    children    which 
would  reflect  credit  on  any  school.    Educa- 
tion is  one  of  the  crying  needs  of  Mexico 
today  and  such  schools  as  this  will  do  more 
than  any  other  agency  to  take  the  idea  of 
revolution  and  banditry  out  of  their  heads 
and  instil  in  its  place  the  values  of  indus- 
try and  peace.     We  were  tendered  a  ban- 
quet by  the  local   Chamber  of   Commerce 
and  the  president  of  this  organization,  Mr. 
F.  E.  Salas,  who  is  also  the  manager  of  the 
International  Ore  and  Smelting  Company, 
made  a  very  forceful  address,  in  which  he 
stressed   the   importance   of   the   American 
merchant  and  manufacturer  giving  more  at- 
tention to  Mexican  business  and  studying 
conditions.     Mr.   C.   A.   Baumbach,  also   a 
member  of  the  Chamber  of  Commerce,  made 
a  very  ardent  appeal  to  American  merchants 
and  manufacturers  to  give  more  attention 
to   Mexico,  stating  that  representatives  of 
European  houses  were  already  coming  in 
rapidly  increasing  numbers.     He   said   we 
should  teach  our  salesmen  the  customs  and 
language  of  the  country  and  give  to  Mexi- 
can -customers   certain   credit   accommoda- 
tion.    He  stated  that  before  the  world  war 
the  European  merchants  had  given  Mexi- 
cans   long   time    credits.      When    the    war 
broke  out,  however,  and  they  were  unable  to 
supply   their    Mexican    trade   the    Mexican 
merchant  had  to  turn  to  the  United  States 
for  his  goods  and  the  opportunity  was  then 
presented  for  us  to  absolutely  establish  our- 
selves   and    dominate    the    Mexican    trade 
field   in   the  future.     However,   instead  of 
taking  advantage  of  the  situation  we  did 
19 


MEXICO      TODAY 


not  seem  to  care  and  when  the  Mexican 
was  forced  to  come  to  us  we  demanded 
"Cash  with  Order"  and  even  then  our 
goods  were  badly  packed  and  in  many 
cases  were  of  very  inferior  workmanship.  He 
stated  that  he  was  speaking  thus  frankly 
because  unless  we  realized  the  situation  at 
once  it  would  be  too  late,  as  the  Europeans 
were  already  back  in  Mexico  offering  to 
sell  goods  on  credit.  He  said  that  the 
credit  situation  in  Mexico  was  very  good 
and  that  the  Dun  and  Bradstreet  agencies 
had  very  complete  and  reliable  credit  in- 
formation on  all  the  Mexican  merchants, 
He  assured  Americans  that  they  would  be 
cordially  received  and  given  every  possible 
help. 


After  leaving  Saltillo  our  train  headed 
for  the  border  and  we  arrived  in  San  An- 
tonio the  afternoon  of  October  30th. 

I  shall  endeavor  below  to  make  a  short 
summary  of  the  general  conditions  in  Mex- 
ico at  present. 

POLITICAL 

Since  Provisional  President  de  la  Huerta 
has  been  in  office  things  have  been  very 
quiet  and  indications  are  that  they  are 
through  with  fighting.  This  belief  is  held 
by  both  natives  and  foreigners  who  are 
close  students  of  conditions.  President- 
elect Obregon  will  take  the  oath  of  office 
at  midnight  November  30.  He  seems  to  be 
very  popular  in  all  sections.  Of  course,  one 
hears  occasional  criticisms  of  him,  but  the 
great  majority  seem  to  think  he  is  capable 
of  dealing  with  the  situation.  He  is  appar- 
ently very  friendly  toward  America,  as  evi- 
denced by  his  many  friendly  utterances 
during  his  recent  visit  to  Texas.  The 
American  in  Mexico  is  very  anxious  to  have 
the  Mexican  Government  recognized  by 
Washington  and  feels  that  this  will  greatly 
help  the  situation.  The  Democratic  admin- 
istration of  the  United  States  is  apparently 
very  unpopular  in  Mexico,  and,  generally 
speaking,  Harding  rather  than  Cox  was  their 

20 


MEXICO      TODAY 


choice  for  President.  Practically  all  of  the 
South  American  countries  have  recognized 
the  present  government.  It  is  unofficially 
stated  that  there  will  be  some  cabinet 
changes  when  Obregon  takes  office,  but  one 
guess  appears  to  be  as  good  as  another  along 
this  line. 

Francisco  Villa  seems  to  concur  in  the 
peace  program,  as  he  has  become  a  quiet, 
peaceful  farmer  and  the  general  opinion  is 
that  he  will  remain  so.  During  our  tour  of 
the  country  we  met  the  Governors  of  al- 
most every  State  we  passed  through  and 
most  of  them  seemed  to  be  high  class  men. 
Elections  are  being  held  all  over  the  coun- 
try and  the  better  class  of  Mexicans  are 
again  stepping  into  politics.  One  of  the 
causes  of  the  recent  trouble  there  was  the 
fact  that  the  high  offices  were  taken  by  the 
lower  class  and  the  military,  but  now  the 
people  say  they  are  tired  of  this  sort  of 
thing. 

In  the  past  there  has  been  quite  a  lot  of 
complaint  about  the  American  Consular 
service.  It  is  claimed  the  Consuls  have  not 
been  carefully  selected  and  in  many  in- 
stances men  of  questionable  character  have 
been  appointed  who  are  reported  to  have 
entered  into  shady  business  dealings  in- 
stead of  looking  after  the  interests  of  their 
country.  There  are  a  number  of  fine  Amer- 
ican Consuls  in  Mexico,  but  there  have 
been  certain  men  appointed  who  did  not 
reflect  credit  on  our  Nation.  In  Mexico, 
as  elsewhere,  you  will  find  renegade  Ameri- 
cans who  stir  up  quite  a  bit  of  trouble,  but 
the  representative  American  business  men 
there  are  making  it  hot  for  these  trouble 
makers. 

While  in  certain  districts  the  attitude  of 
the  uneducated  peon  may  be  more  or  less 
unfriendly  to  the  United  States,  the  repre- 
sentative Mexican  business  men  and  poli- 
ticians now  realize  that  our  friendship  is  sin- 
cere and  they  stand  ready  to  receive  us  in 
the  most  cordial  manner.  The  political 
outlook  is  unquestionably  brighter  now  than 
at  any  time  during  the  past  ten  years. 

21 


MEXICO      TODAY 


Americans  can  travel  in  safety  and  large 
numbers  are  now  returning  to  the  country. 


FINANCIAL, 


While   the    Government   is   having   hard 
sledding  at  present,  Mexico  is  by  no  means 
a  bankrupt  nation.     It  has  already  demon- 
strated how  quickly  it  can  begin  to  "come 
back."     If  it  were  not  naturally  one  of  the 
richest  countries  in  the  world  they  would 
have    starved    to    death    long   ago.      Their 
financial  condition  is  improving  daily  and 
they  get  an  enormous  revenue  from  the  oil 
fields  and  the  railroads  alone.     As  stated, 
Mexico  is  handicapped  by  a  lack  of  good, 
strong  banks.     The  interest  rates  charged 
by  the  present  banks  range  from  12  to  36 
per  cent  per  annum.     The  average  rate  for 
the   Republic  would  probably  be   from   18 
to  24  per  'cent.     This  sounds  unreasonable, 
but  it  is  explained  that  owing  to  the  un- 
settled conditions  which  existed  in  Mexico 
during    the    period    of    revolution    the  lo- 
cal  banks   feared    to   keep   much   of   their 
capital  and  deposits  in  the  country  where 
it  might  be  stolen  or  confiscated  and  there- 
fore kept  approximately  60  or  70  per  cent 
of  their  money  in  banks  in  the  States.    This 
only  left  them  about  30  per  cent  to  work 
with  and  they  consequently  had  to  charge 
a  very  high  rate  of  interest  to  make  a  profit- 
able return.     Also  the  fact  that  they  keep 
two  sets  of  books,  one  in  American  dollars 
and  one  in  Mexican  gold,  makes  their  over- 
head expense  abnormally  large.    Now,  how- 
ever,  as   conditions   settle   down,   they  are 
bringing    back    to    Mexico    more    of    their 
funds. 

Mexico  is  on  a  gold  basis.  There  is  no 
paper  money  in  circulation.  The  only 
money  is  Mexican  gold,  silver  and  copper 
coins  and  quite  a  large  amount  of  Ameri- 
can money, 'both  gold  and  silver,  with  some 
U.  S.  currency.  American  money  is  readily 
accepted  in  all  the  larger  towns  at  two  for 
one.  Of  course  at  the  banks  where  the 
large  exchange  operations  are  transacted 
the  rate  fluctuates  slightly. 

The  banks  of  Mexico  City  and  Tamprco 

2Z 


MEXICO      TODAY 


clear  practically  all  items  drawn  on  every 
part  of  Mexico.  There  are  several  banks 
operating  in  Mexico  with  branches  in  the 
principal  cities  and  with  arrangements  with 
some  local  merchant  in  the  smaller  town 
who  acts  as  an  agent  for  the  bank  in  col- 
lecting items. 

Banking  appears  to  offer  one  of  the  widest 
fields  in  Mexico,  for  provided  the  country 
has  peace,  there  should  be  comparatively 
more  money  made  in  Mexico  in  the  next 
ten  years  than  in  most  any  other  country. 
There  is  also  a  great  field  for  large  import 
and  export  organizations  to  help  finance 
some  of  the  trade  that  is  now  developing. 
A  concern  of  this  character  should  realize 
very  satisfactory  returns  on  its  investment. 

INDUSTRIAL 

Mexico  appears  to  have  gone  back  to 
work.  Her  factories,  mines,  smelters,  mills, 
oil  industries,  railroads,  and  in  fact  all 
lines  of  industry  seem  to  be  working  full 
speed.  There  is  an  urgent  local  demand  for 
all  manufactured  products  and  the  people 
engaged  in  these  enterprises  appear  to  be 
making  money. 

The  railroads  are  being  rapidly  restored 
to  their  former  usefulness.  The  roadbeds 
are  in  exceptionally  good  condition.  The 
only  evidence  of  destruction  is  the  bridges 
which  were  blown  up  or  burned  and  a  large 
number  of  burned  freight  cars.  The 
bridges  have  been  repaired  and  the  freight 
cars  are  being  rapidly  reconstructed.  Ad- 
ditional equipment  and  rolling  stock  is  need- 
ed. One  feature  that  makes  it  hard  for 
the  Mexican  importers  is  that  all  cars  owned 
by  American  roads  are  placed  under  a  heavy 
bond  before  they  are  allowed  to  cross  the 
border.  This,  of  course,  ties  up  a  large 
amount  of  Mexican  money  which  could 
otherwise  be  used  for  buying  additional  mer- 
chandise. Action  is  being  taken  now  toward 
having  this  feature  eliminated.  The  Gov- 
ernment has  inaugurated  the  following  plan 
to  get  cars  reconstructed:  any  Mexican 
concern  which  needs  cars  can,  at  its  own 

23 


MEXICO      TODAY 


expense,  have  these  cars  reconstructed  and 
then  have  that  particular  car  or  cars  for  its 
own  private  use  for  a  given  period,  usually 
one  year.  However,  it  must  pay  the  rail- 
roads the  usual  charge  for  hauling  these 
cars.  The  merchants  are  glad  to  do  this 
and  the  majority  of  cars  you  see  bear  the 
caption:  "This  car  reconstructed  by  John 
Doe  &  Company  for  its  exclusive  use  until 

date."    The  Mexican  Government  does 

not  wish  to  handicap  enterprises  by  exces- 
sive tax  burdens  and  assures  business  that  it 
will  receive  generous  consideration.  The 
Government  has  recently  designated  Guay- 
mas,  Salina  Cruz  and  Puerto  Mexico  as 
"free  ports."  Merchandise  for  transport 
through  Mexico  en  route  for  other  foreign 
countries  is  not  subject  to  interference  by 
the  Treasury  Department  or  the  Customs 
authorities.  Under  this  decree  raw  material 
may  be  shipped  into  these  ports  and  manu- 
factured and  the  finished  article  exported 
to  other  countries  without  the  payment  of 
duty. 

AGRICULTURAL 

Agriculturally  Mexico  is  still  in  its  in- 
fancy. There  are  millions  of  acres  of  un- 
developed farming  land  that  needs  nothing 
except  the  plow  and  hoe  to  make  it  a  veri- 
table garden.  In  addition  there  are  vast 
sections  of  land  subject  to  irrigation  which, 
when  developed  and  given  water,  will  be 
very  profitable  indeed. 

At  present  there  is  a  situation  existing 
which  is  held  by  some  to  be  unjust.  The 
United  States  Government  prohibits  the  im- 
portation of  certain  Mexican  agricultural 
products,  mainly  tropical  fruits,  it  being 
claimed  that  these  products  are  infected  with 
some  destructive  moths  or  worms.  The 
growers  in  Mexico  are  very  indignant  about 
this  as  it  has  worked  a  great  hardship  on 
them  and  they  say  that  it  is  purely  a  politi- 
cal move  instigated  by  the  California  and 
Florida  fruit  growers  to  prevent  competi- 
tion from  Mexico.  A  number  of  disinter- 
ested Americans  with  whom  I  talked  stated 
that  the  Mexican  products  prohibited  were 

24 


MEXICO      TODAY 


in  no  way  defective  or  harmful.  Mexico 
possesses  practically  every  kind  of  soil  and 
climate  and  farming  should  develop  rapidly 
there  since  so  large  a  number  of  soldiers 
have  gone  back  to  peaceful  pursuits. 

SOCIAL.  AND  RELIGIOUS  CONDITIONS 

Mexico  is  a  land  of  two  extremes — very 
rich  and  very  poor.  The  rich  are  well  edu- 
cated, cultured  and  refined.  Their  children 
are  educated  either  in  the  States  or  in 
Europe.  On  the  other  hand,  the  peon  is  the 
picture  of  poverty.  One  wonders  how  he 
manages  to  keep  alive.  He  lives  in  dirty 
hovels  and  begging  is  a  side  profession  of 
great  numbers.  Education  is  the  solution 
of  this  problem  and  already  improvement 
in  this  respect  is  noticeable.  The  writer 
lived  in  Mexico  some  eleven  or  twelve 
years  ago  and  since  that  time  they  have 
made  progress  in  point  of  education,  in  spite 
of  their  internal  troubles,  and  now  that  they 
are  at  peace,  their  educational  program 
should  progress  rapidly.  When  the  peon 
has  prepared  himself  through  education  to 
do  better  work  and  earn  more  money  the 
great  present  barrier  between  the  two 
classes  will  be  materially  reduced. 

Mexico  is  a  land  of  cathedrals.  The  aver- 
age Mexican  is  a  very  devout  Catholic. 
Some  think  that  the  fact  that  the  people 
have  to  support  so  many  churches,  priests, 
etc.,  is  one  reason  they  are  so  poor,  as  the 
Mexican  will  give  to  his  church  even  if  he 
has  to  go  hungry  to  do  it.  Several  Prot- 
estant churches  have  been  established  in 
Mexico  and  are  said  to  be  increasing  their 
membership.  The  Y.  M.  C.  A.  has  entered 
Mexico  and  is  doing  a  great  work  among  the 
young  men. 

There  has  been  a  movement  started  re- 
cently by  the  American  Chamber  of  Com- 
merce of  Mexico  City  to  have  American 
business  houses  who  want  to  go  after  Mex- 
ican business  help  some  deserving  Mexican 
young  man  through  a  college  education  in 
some  American  school  with  the  idea  of  in- 
stilling our  methods  and  ideas  in  him  so  he 

25 


MEXICO     TODAY 


can  be  a  capable  representative  of  an 
American  concern  in  Mexico.  A  number 
of  schools  have  endorsed  the  plan  and  a 
few  business  houses  have  Mexican  young 
men  now  taking  these  courses.  If  carried 
out  generally,  this  would  be  a  good  thing 
and  these  Mexicans,  upon  their  return  to 
their  country,  would  do  much  toward  bet- 
tering our  relations  with  Mexico. 


GENERAL   SITUATION 


In  summing  up  I  would  say  that  the  eco- 
nomic situation  is  very  much  better  than 
Americans  generally  think.  We  have  not 
been  given  a  true  picture  of  conditions  by 
the  newspapers.  Mexico  has  been  through 
several  years  of  internal  disorder  but  has 
emerged  remarkably  free  from  the  physical 
destruction  one  would  imagine.  The  oil 
question  which  has  caused  so  much  worry 
bids  fair  to  be  settled  and  there  is  every 
indication  that  foreign  capital  will  soon  be- 
gin to  flow  into  Mexico  to  develop  the  won- 
derful natural  resources  of  the  country. 

Mexico  needs  our  manufactured  products 
and  our  financial  assistance.  I  believe  the 
Mexicans  are  sincere  in  their  desire  to  have 
us  come  and  do  business  with  them.  I  be- 
lieve the  Mexican  merchant  desires  to,  and 
will,  meet  his  obligations  with  reasonable 
promptness,  and  I  believe  further  that  the 
present  and  the  incoming  Government  is 
very  friendly  to  Americans  and  to  American 
capital. 

Mexico  presents  possibly  the  most  attrac- 
tive trade  field  in  the  world  today  and  the 
United  States  is  the  logical  nation  to  obtain 
the  benefit  of  this  trade.  Prompt  action 
is  essential  if  major  benefits  are  to  be  en- 
joyed. 

Respectfully   submitted, 

W.  H.  MOSELEY,  Jr. 
Nov.  8,  1920. 


26 


WE  ARE  EQUIPPED 
TOCARE  FOR  YOUR 
BANKING  AND 
TRUST  BUSINESS 

DEPOSIT  ACCOUNTS 
FOREIGN  EXCHANGE 
COMMERCIAL  CREDITS 
ACCEPTANCE  CREDITS 

TRAVELERS  LETTERS 

OF  CREDIT 

INDIVIDUAL  TRUSTS 

CORPORATE  TRUSTS 

TRANSFER  AGENT 

REGISTRAR 

SAFEKEEPING  OF  SECURITIES 

We   are  also   legally   authorized   to   act  as 

EXECUTOR  and  TRUSTEE 

under  Wills. 


THE 

AMERICAN    EXCHANGE 
NATIONAL    BANK 

Capital  and  Surplus  $10,000,000 

(Established    1838) 

128  BROADWAY  NEW  YORK 


The  American  Exchange 
National  Bank 

New  York  City 
LEWIS  L.  CLARKE 

President 

WALTER  H.  BENNETT         LOUIS  S.  TIEMANN 

Vice-President  Vice-President 

THEODORE  H.  BANKS         MERCER  P.  MOSELEY 

Vice-PreiidenC  Vice-President 

GEORGE  C.  HAIGH  WILLIAM  P.  MALBURN 

Vicc-Prwident  Vice-President 

THOMAS  L.  ROBINSON 

Vice-Preiident 

ARTHUR  P.  LEE 

Cashier 

A.  K.  de  GUISCARD  FREDERIC  M.  LANGDON 

Asst.  Cashier  Asst.  Cashier 

HUGH  S.  McCLURE  HENRY  P.  SEIBERT 

Asst.  Cashier  Asst.  Cashier 

WALTER  B.  TALLMAN        W.  G.  CLINKUNBROOMER 

Asst.  Cashier  Asst.  Cashier 

ALEX.  G.  ARMSTRONG       JOHN  P.  G.  MORAN 

Asst.  Cashier  Asst .  Cashier 

ROY  MURCHIE  LUKE  D.  DOYLE 

Asst.  Cashier  Asst.  Cashier 

ARTHUR  D.  BRIGHT  HOWARD  MARSHALL 

Asst.  Cashier  Asst.  Cashier 

CHARLES  E.  MEEK  GEO.  W.  GIDDINGS 

Asst.  Cashier  Asst.  Trust  Officer 

Directors 
AVERY  D.  ANDREWS          WILLIAM  P.  DIXON 

Royal  Dutch-Shell  Cos.  Dixon  &  Holmes 

THEODORE  H.  BANKS         STEPHEN  B.  FLEMING 

Vice-President  Pres..  Intern'l  Agri.  Corp. 

Director,  The  Pacific  Bank  PFORPF  I  FPP. 

WILLIAM  M.  BARRETT  New  York 

President,  Adams  Express  Co.  Director,  The  Pacific  Bank 

WALTER  H.  BENNETT         EDGAR  J.  NATHAN 

Vice-President  Cardozo  &  Nathan 

Director,  The  Pacific  Bank  EDWARD  C.  PLATT 
H.  C.  BLACKISTON  Vice-President,  Mackay  Cos. 

Dir..  Furnes,,  Withy  &  Co..  Ltd.  JOSEPH  A.  SKINNER 
and  Pnnce  Line.  Ltd.  Wm    Skinner  &  SaM 

ORION  H.  CHENEY  JAMES  A.  SMITH 

Pres..  Pacific  Bank  of  New  York  Calhoun.  Bobbins  &  Co. 

LEWIS  L   CLARKE  Director.  The  Pacific  Bank 

President  ELBRIDGE  GERRY  SNOW 

Director.  The  Pacific  Bank  President.  Home  Ins.  Co. 

R.  FULTON  CUTTING  CLAUS  A.  SPRECKELS 

NewYork  Pres..  Federal  Sugar  Ref.  Co. 

JOHN  T.  TERRY 

New  York 
Director,  The  Pacific  Bank 


oayiora  Bros. 

Makers 

Syracuse,  N.  Y. 
PAT.  JAN.  21,  1908 


